An institutional analysis1 for a community forestry project typically
attempts to understand the incentives that motivate human behaviour in a particular
place at a particular time and the impact of those behaviours on the natural
resource base. It does this by analysing incentives, choices and outcomes.

1 The form of institutional analysis described in this field manual draws heavily on several variants of Institutional Analysis and Design (IAD) developed since the 1950s by scholars and practitioners associated with the Workshop in Political Theory and Policy Analysis, Indiana University, Bloomington, IN, USA. IAD is used to analyse a multitude of problems including institutional issues in the governance and management of renewable resources such as forests, fisheries, groundwater basins, watersheds and pastures. See in particular Oakerson, 1992; Ostrom, 1991; and Ostrom, 1992.

An incentive is something that makes a person want to do something. Money can be an incentive: a project can pay people to plant trees, for example. Fear can be an incentive: fear of their ancestors may cause a group of people to protect a sacred forest. Concern for family welfare can be an incentive: farmers may plant trees on their fields in hopes of increasing their yields so they can feed their families better. In short, incentives take many forms. The complex array of incentives facing individuals and communities in large part determines their interactions with the environment around them.

One part of an institutional analysis involves trying to understand the incentives people face and the sources of those incentives. Because incentives come from many different sources and take many different forms it can be difficult to discern the multiple and diverse incentives that are at work in a community. This manual suggests that incentives can best be understood by breaking the problem down and considering three kinds of incentives that people typically face: (1) incentives related to the characteristics of the resource base; (2) incentives related to the characteristics of the community; and (3) incentives related to the characteristics of the rules in place in that community. The box illustrates briefly how each of these factors can create incentives or disincentives for people's behaviour toward a tree resource. These issues will be taken up in much greater detail in Chapters 3, 4 and 5, which address each of these sources of incentives in turn.

Types of Incentives to Resource Use

In the village of Timifa, there are many mango trees that produce a particularly
succulent and desirable fruit. These trees are owned by the people who
planted them and according to the tenure rules of the village the fruit
may not be picked by anyone without the owners permission. Since the principal
violators of the rule are generally children who pick the mangoes while
they are still green, the punishment is a beating of the miscreant and
a small fine for the parents. This is an example of a disincentive that
is associated with the rules of the community. There is a rule
against harvesting fruit; it is clear and well understood and is associated
with an explicit punishment. While some of the mango trees are planted
in the near fields of the village and around compounds, many of them are
in more distant fields. Since these are early mangoes, they generally
ripen before farmers are active in the fields and so, short of posting
a guard in the outer fields, there is no way of identifying the mango
thieves and making them face punishment. In this case, a characteristic
of the resource (the difficulty of controlling access, meaning that the
culprit is unlikely to be caught) substantially reduces the incentive
to obey the rule.

The people in the community, however, have strong animistic beliefs and
universally fear certain forest spirits that they believe inhabit the
region. Some farmers hang amulets in their trees, as no one would dare
approach a tree that is under such a spirits protection. A characteristic
of the community, namely its shared religious beliefs, adds incentives
that protect the fruit and the rights of the owner.

A second part of the analysis involves looking at the choices people make when confronted by various incentives. These choices result in patterns of resource use. In the case of the mangoes, each person in the area faces a set of incentives and disincentives to picking the luscious mango fruit. Depending on how people weigh those incentives and disincentives, they will decide whether or not to pick the fruit, and, if so, when and where. Their decisions will have an immediate effect on the resource and will also have secondary effects on future actions of others in the community. If the incentive structure is such that trees far from the village are being raided regularly, then villagers may decide no longer to plant trees in those more remote areas, or they may try to change the incentives to protect owners' rights, or they may decide that it really does not matter because the quantity picked by the children is insignificant in comparison to the total harvest.

The discussion of choices introduces the third part of the analysis, which assesses the outcome of all the choices being made in order to determine whether and how changes should be made in the system of incentives. People face a complex set of incentives as they go about their daily lives. They make choices throughout the day and the year that are based on these incentives. The result is a pattern of resource use by individuals and by the community as a whole. What is the impact of all those resource use decisions on forests, trees and the community itself?

There are many criteria that can be used to assess the impact of the incentive structure on the resource base and on members of the community.

· The efficiency of how the resource is being used: Are resources being used to their maximum potential? Is there wastage?

· The equitability of resource exploitation: Do some people have greater access than others? What is the basis of discrimination in resource access? Is the system 'fair'?

· The sustainability of resource use: Can these use patterns be sustained into the future? Are resources regenerating at approximately the same rate at which they are being used?

· The preservability of biological diversity: Are diverse species being protected? Are some species becoming dominant at the expense of others?

In this part of the analysis, the forestry professionals, project personnel and members of the community will need to sit down together to discuss the effect that current resource use patterns are having both on the local population and on the resources themselves. It is important to bring as much knowledge as possible to bear on these discussions. The outsiders will be able to offer insights based on their professional experience; villagers will have critical insights based on their intimate knowledge of the local environment and community.

There are no absolute 'rights' and 'wrongs' in such an analysis and, in fact, there are likely to be trade-offs in terms of the various criteria that are used to evaluate the outcomes. Resource use patterns that are highly equitable, allowing everyone in the community equal access to a resource, may in some cases lead to unsustainable use. Sustainable use may call for more controls and limits on resource use, but those controls may not be applied even-handedly and some groups (a certain ethnic group, newcomers, outsiders, women) may lose out when controls are established. A system that is designed to be highly sustainable, requiring the authorization of a forestry professional before a tree can be cut, for example, may be highly inefficient if it means that villagers have to spend time and travel long distances to get the requisite approvals.

The key, then, in assessing outcomes is to avoid following a preconceived idea of what the 'correct' outcomes should be. The appropriateness of the outcomes will depend on values that are determined explicitly by the community, perhaps in consultation with outside professionals. The inhabitants of one community may decide that they want to preserve a dense forest area by prohibiting cutting under any circumstances. People in another community may decide, in light of their community's values, that they will permit some types of exploitation of their forest even if this implies a limited loss of biomass or biological diversity. What is important is that the criteria used to evaluate the outcomes (and to modify the incentive structure if necessary) be explicit and systematic. Trade-offs, especially, should be examined carefully so that everyone understands the costs and advantages of making certain decisions.

The interactions between (1) the characteristics of the resource, the community and the rules, (2) the incentives for individual behaviour and. (3) the impact on the resource base are illustrated in Figure 1. The downward arrows trace the development of the process that has been described here. The characteristics outlined above create incentives for behaviour, leading people to make certain choices, which in turn result in an outcome (positive or negative) on the resource base. The upward feedback arrows are reminders, however, that these outcomes may provoke further changes in the characteristics of the resource, the community and the rules.

Unsustainable outcomes may result in resource shortages and scarcity that alter the characteristic of the resource in question; inequitable outcomes may result in conflict that over time changes certain characteristics of the community; inefficient use may cause the community to change some of the rules governing resource access. In short, the system is not a static one but is constantly changing and evolving.

Because the elements of the model (characteristics, incentives, choices/behaviour, and outcomes) are interactive, in practice the analysis of incentives, choices and outcomes may not follow the sequential order described above. More often, a problem (outcome) is diagnosed first and the analysis works backward from there. A forester may be attracted to work in a community precisely because a negative outcome is observed. Perhaps the forester observes massive cutting of old growth on steep hillsides around the community and is concerned that this will result in serious soil erosion and rapid deterioration of the resource base. This may lead to a study that attempts to analyse the pattern of resource exploitation (who is cutting and when) and then probes more deeply to understand the incentive structure (why) that may be influencing this activity. This, in turn, might cause the community to introduce changes in conjunction with the project that would result in a different balance of incentives and greater protection of the hillsides.

Adapted from a series of models developed by participants at the Workshop in Political Theory and Policy Analysis, Indiana University, Bloomington, IN, USA.

In short, it is important to initiate the institutional analysis by working backwards through the chain of heavy black arrows. Once the incentive(s) for inappropriate behaviour is (are) clarified, it may be possible to do something about it (them). To do so, one must understand the interconnections between the different parts of the analysis and their relevance for natural resource management. The key is to ensure that none of the three steps is left out. It is useless to analyse the incentives that lead people to act in ways that degrade renewable resources if that information is not used to better understand people's interactions with their environment and to determine how those interactions can be made more sustainable, equitable, etc., by changing the incentives people face. Similarly, it is of little use to identify an unsustainable activity if one does not then try to understand the kind of incentives that underlie that activity, and how those incentives might be changed to give people a reason to act in more resource-friendly ways.

This manual focuses on the analysis of incentives, since this is where some of the most detailed and complex reflection is required. As the various sources of incentives are addressed, the possible consequences on resource use decisions and patterns of exploitation are discussed, as well as the implications for sustainable, equitable and efficient resource use. In this way, the interaction between these three levels of analysis is highlighted throughout the text.

The Guidelines Box on the following page serves as a reminder of some of the issues to be considered as the professional begins a process of institutional analysis with a local community. The chapter concludes by introducing a hypothetical case study that illustrates the concepts that have been discussed up until now. These issues will be treated in greater detail and the case study will be further developed in the chapters that follow.

Guidelines for implementing an institutional Analysis:Setting Up the Study

The first task in an institutional analysis is to identify the community where the analysis will take place and the general issues to be considered. This will often involve the activities listed below. They are described here as preliminary because the information assembled at this stage will be refined as the study progresses.

1. Make a preliminary identification of the community.

2. Make a preliminary identification of the problem.

The first two steps are linked, since identification of the community and the problem are inter-related. In most cases an institutional analysis will be most successful if it starts with a community forestry problem (that is, something that the community or some of its members consider to be a problem) and then tries to understand the problem in its larger context. Usually the problem will arise from a difficulty that local people encounter In trying to meet their subsistence needs maintain or strengthen their production systems, or produce goods or services for market. At this stage the key is to focus on a community that has a community forestry problem and appears motivated to address that problem in collaboration with the outside facilitator:

3. Make a preliminary identification of stakeholders with an interest in the problem.

Gather as much information as possible through informal discussion and investigation in order to identify the principal protagonists In the problem and others who may have a less direct role but are still concerned. They are likely to include both resident community members as well as outsiders: government officials, project personnel, etc.

4. Establish a process to study the issue In collaboration with community leaders, local activists, stakeholders and other concerned community members.

This manual outlines issues that must be considered in a systematic institutional analysis and proposes methods that may serve in gathering the information that is required it recommends the Participatory Rural Appraisal (PRA) methodology as one useful approach to studying these questions because PRA is well suited to the type of collaborative, reflective, research process that attempts to come up with practical responses to concerns raised by communities. (See Appendix I for brief descriptions of eight PRA tools, Some or all of which may be useful in trying to solve a community forestry problem with concerned members of a community.) The authors recognize that there are many other valid mechanisms for gathering this kind of information indeed the issues are far too complex to recommend a single approach that would be valid for all places and cases. Readers are advised to think carefully about the method that will work best in their milieus and to use the conceptual framework that is presented to guide the community through the study process. In all cases the approach the participants and the tools used will have to be adapted to local conditions. The key is to ensure that the community has a role in planning the study and feels comfortable with its objectives and with the process that is put in place.

Garin Dan Djibo is a small village near Niger's border with Nigeria, well north
of the forests and 200 km south of the Sahara. Rainfall is low and the
fragile soils blow in the wind. Though this community is an imaginary
one, there are thousands of villages like Garin Dan Djibo throughout the
Sahelian region of west and central Africa.

There are approximately 1 00 households in this community, and the people share the same language and culture. The level of economic well-being varies from household to household, but outsiders would consider the peasant farmers living in the village to be quite poor. Their houses are clustered close to one another but their farms are on the periphery of the village; some are as much as a 5 km walk away from where people live. For as long as people can remember, farmers in this semi-arid area have grown millet, which is the principal pillar of their subsistence. Preparing the land and tending to millet define the seasonally of work, for women as well as men. Over the years, the village has grown in size, and people now compete for good land and forest resources, which are becoming increasingly scarce.

While the villagers of Garin Dan Djibo consider themselves to be primarily
cultivators, they do keep some animals. Most families own both goats and
Zebu cattle, though the size of their herds has diminished noticeably
over recent decades. These animals are put under the care of specialist
herders who live in the area. During the dry season the animals are herded
onto village lands where they use the fields (now harvested) for pasture
and leave their manure, which is a prime source of fertilizer for the
sandy soils. In addition, transhumant pastoralists move through village
lands twice a year, usually with much larger herds than those that are
owned locally.

Farming practices in Garin Dan Djibo are still mainly very traditional. Tools and agricultural inputs have changed little from those used by the inhabitants' great-grandfathers. Yet this apparent conservatism masks some major changes in production systems since the colonial period. It was during that time (1899-1960) that groundnuts were introduced. Also during the colonial period the administration began requiring adults to pay an annual head tax in cash, a policy designed to promote the production of groundnuts, the principal cash crop. In years of crop failures caused by drought men from Garin Dan Djibo would find work as migrant labourers.

The decade after Niger gained its independence in 1960 was a time of expanded production of groundnuts in Garin Dan Djibo. The fields of the village were increased at each opportunity as pastures were cleared and put into groundnut production. There was less grazing land for livestock, and villagers had to walk farther each year to collect fuelwood or cut poles for house construction. At the same time the numbers of both people and livestock were increasing.

Both French colonialism and commercial groundnut production are distant memories in Garin Dan Djibo at the time when our story begins. The village, more than twice the size it was at the time the country gained its independence, is now connected by a dirt road to the arrondissement (county) centre, some 40 km away, where there is a large regional market. The villagers now produce almost no groundnuts because soil fertility has diminished severely but the cash economy continues to be important. Truck operators travel to Garin Dan Djibo to buy charcoal and other forest products, and farmers use the cash to buy commercial items at the market. Men now migrate more frequently to distant urban areas to look for work.

The institutional and physical environments have also undergone profound changes over the last century. The administration is now considerably closer and more involved in day-to-day village life than it was during the colonial period. Now government offices at the canton (subcounty) level are staffed with civil servants and technical field staff, all with considerable authority to interpret and implement national government policy and offer technical advice. The canton offices, 1 5 km from the village, have extension agents for forest and agricultural issues as well as health services. The physical surroundings of Garin Dan Djibo have also changed dramatically. Land that was once forested and then cleared for groundnut production is now little more than blowing sand. Some of this land has been planted with millet, but most of it is too poor for cultivation; trees and bushes have not regenerated and it offers only the most barren grazing for livestock. The village has lost significant amounts of topsoil to wind erosion and millet yields have consequently declined.

As happens throughout the world in communities that have experienced rapid social change and environmental degradation, the village of Garin Dan Djibo has begun to experience interpersonal conflict to a degree unknown in past decades. As fertile land has become more scarce, there are more disputes among families over rights to land; both villagers and outsiders quarrel over access to other natural resources in the territory. The situation facing a farmer named Maman is illustrative of the kinds of issues that have become so confrontational in recent years.

Agroforestry and the Gawo Tree

Nearly 10 years ago Maman, who has lived most of his life in the village of Garin Dan Djibo, decided he would encourage the growth of more gawo (Acacia albida) trees on his fields. Gawo trees reseed themselves naturally in the sandy, cultivated soils of millet fields, particularly when deposited in the droppings of animals that have eaten the pods. Unless particular care is taken, however, most of these seedlings do not reach maturity because they are eaten by animals or damaged by the ploughs used to prepare the millet fields. As a result, most fields have no more than two or three gawo growing on them.

Maman had heard from several sources that a higher density of gawo would
protect his millet field from wind erosion and improve its soil fertility,
problems that were becoming more serious each season. The gawo
tree drops its leaves just before the growing season. These leaves, which
are rich in nutrients, help to fertilize the soil while the roots fix
nitrogen with their nodules. The bare branches allow enough sun to reach
crops so they grow well but also provide a lattice of shade that protects
millet plants growing under the tree's crown, especially during periods
of drought. The leaves sprout again once the rainy season has ended. They
provide welcome shade for domestic livestock, which also browse on the
leaves and vitamin-rich seed pods. The droppings of animals that congregate
around the gawo trees in fields also make a significant contribution
to soil fertility.

When Maman decided to attack the problem of soil erosion by protecting the gawo seedlings in his field, he first marked the seedlings with a strip of red cloth so that he would be sure to plough around them. Then, before the animals were released into the fields after the harvest, he carefully wove a protective sleeve made of reeds and thorn branches for each seedling so that animals could not nibble on the tender bark. For nine years, Maman systematically protected the gawo seedlings in his millet field. Seedlings and saplings, some as high as 5 m tall, were well established in his field and were just beginning to have the desired effect in improving the soil and reducing erosion when disaster struck.

Conflict

In April of the tenth year, near the end of the dry season, Maman went to his field to ready it for cultivation. He had not visited the area since the previous November when he had put the thorn sleeves around the new seedlings. He had had no other reason to be in his field during the dry season. As Maman approached his field he could see that instead of being covered with a small forest of gawo trees, the field was littered with branches stripped of their leaves. Someone had entered the field and cut 20 of the 30 saplings growing there. Maman suspected that it had been a herder because some of the trunks and branches were still lying on the ground but had been stripped of their leaves, presumably for animal fodder. It appeared that some of the larger poles had been dragged off by people looking for fuel-wood or building poles. After his initial surprise and anger, Maman began to think more calmly about the situation. He thought of trying to identify the culprit and demanding compensation, but how could he track down a herder who had perhaps passed through weeks earlier? After mulling over his options, he concluded that he just had to be realistic and accept that his plan had failed: if he could not control poaching by outsiders, he would have to abandon his idea of using gawo trees to improve the productivity of his millet field. This conclusion was all the more depressing because he knew that in no way could he afford chemical fertilizers.

Maman left the field carrying two poles on his shoulder, determined to return immediately with his children to collect the rest of the wood that had been cut down. On his way home he met a government extension agent, whom he informed of both the situation and his decision. The extension agent was sympathetic but he realized that under the circumstances there was nothing he could say that would convince Maman to change his mind. They parted, going their separate ways.

Commentary

In this introduction to the case study some first indications of incentives, choices and outcomes can already be discerned. The planting of gawo trees in the village would be environmentally beneficial on several counts, increasing soil fertility and decreasing wind erosion in an area where these are substantial problems. Yet a progressive farmer who took the initiative to plant these trees has become so discouraged that he has abandoned his project. The initially positive incentives that led to his choice to protect the trees have changed so that now he and probably others who have observed his actions will be discouraged from investing their time in this important community forestry activity.

Maman's decision was also highly discouraging to the technical field staff posted to his area. From a technical point of view, growing Acacia albida on farmland was an intelligent and appropriate decision and, however small in scale, the initiative was having the intended effect on this particular millet field. Now the agent's technical recommendations were coming up against difficult institutional problems. This is precisely the kind of case where it can be helpful to undertake a systematic institutional analysis. By looking at the incentives people face (both those who would plant trees and those who might cut them down), the community, with the assistance of the extension staff, may be able to find ways to change those incentives in order to protect the initiatives of farmers like Maman whose efforts make a significant contribution to improving the local environment.